Brazilian mall operator Iguatemi to launch e-commerce operation

Reuters Staff

2 Min Read

SAO PAULO, Aug 8 (Reuters) - Iguatemi Empresa de Shopping Centers SA, an upscale mall operator that recently joined Brazil’s benchmark Bovespa index, is preparing to launch an e-commerce initiative in the first half of 2019, an executive said on Wednesday.

Speaking to analysts following the company’s second-quarter results, Chief Executive Carlos Jereissati attributed a 23 percent rise in administrative expenses in part to the costs of launching the e-commerce unit. While he gave no details on its structure, he said it would be an important growth area.

“We’re going to enter into the world of e-commerce, taking advantage of Iguatemi as a brand and as a trend-starter,” he said.

Brazilian mall operators, including BR Malls Participacoes SA, Multiplan Empreendimentos Imobiliarios SA and Cyrela Commercial Properties SA, have launched or pledged to launch e-commerce units. Iguatemi would be the most upscale mall operator to confront fast-growing online retailers on their own turf.

E-commerce units have taken a variety of forms, including click-and-collect operations in which customers come to malls to pick up prepared packages they purchased online.

Jereissati said that activity at Iguatemi’s malls had been “relatively good” in August, although July traffic had been hurt by the World Cup.

Shares in Iguatemi were up 0.5 percent in early afternoon trade, while the Bovespa was roughly flat.

The firm posted a quarterly net profit of 61 million reais on Tuesday night, in line with estimates. (Reporting by Gabriela Mello; writing by Gram Slattery; editing by Jonathan Oatis)